Arbitron Inc. (Form: 8-K)

Investor Contact: Thom Mocarsky
Arbitron Inc.
410-312-8239
thom.mocarsky@arbitron.com

Press Contacts: Didi Blackwood / Jessica Benbow
Arbitron Inc.
410-312-8523 / 410-312-8363
didi.blackwood@arbitron.com / jessica.benbow@arbitron.com

ARBITRON INC. REPORTS 2010 FIRST QUARTER FINANCIAL RESULTS
Agreement reached with PPM Coalition that settles the dispute regarding
Portable People Meter methodology
Company reports earnings per share of $0.51
Results include $1.2 million pre-tax pension settlement charge
Reiterates 2010 full-year guidance for revenue and EPS

Columbia MD, April 22, 2010 – Arbitron Inc. (NYSE: ARB) today announced results for the first quarter ended March 31, 2010.

Net income for the quarter was $13.7 million, or $0.51 per share (diluted), an increase of 11.4 percent, compared with $12.3 million, or $0.46 per share (diluted), for the first quarter of 2009. Net income for the first quarter of 2010 included a pre-tax pension settlement charge of $1.2 million, or $0.03 per share (diluted). Net income for the first quarter of 2009 included an $8.2 million charge, or $0.19 per share (diluted) relating to the reorganization and restructuring initiated during that quarter.

For the first quarter of 2010, the Company reported revenue of $95.9 million, a decrease of 2.6 percent as compared to revenue of $98.5 million during the first quarter of 2009.

Revenue for the quarter declined versus the first quarter of 2009 as the result of a number of previously disclosed factors including: the decision by Cumulus and Clear Channel to subscribe to a competitor’s diary-based radio ratings service in a limited number of small and medium-sized markets; the continuing impact of the advertising recession on renewals and new business; and the impact of certain customers, primarily Univision, not subscribing to the Portable PeopleMeter^TM (PPM^TM) service in certain markets. The impact of these items during the quarter offset the increase in revenue realized from the ongoing transition to PPM pricing in the 33 markets where the service is currently commercialized.

Costs and expenses for the first quarter declined by 6.3 percent, from $75.4 million in 2009 to $70.7 million in 2010, due largely to the impact of a $8.2 million restructuring and reorganization charge reported in the first quarter 2009.

Operating income in the first quarter increased 9.3 percent, from $23.1 million in 2009 to $25.2 million in 2010.

Earnings before interest and income tax expense (EBIT) for the quarter were $22.7 million, an increase of 13.0 percent compared with EBIT of $20.1 million for the first quarter of 2009.

Management Comment on First Quarter 2010 Results
Said William T. Kerr, President and Chief Executive Officer:

“Our results in the first quarter do not fully reflect the progress we have made in our PPM commercialization plan. We remain optimistic that an improvement in overall economic conditions will positively impact the advertising marketplace, which could favorably impact our customers and our own business.

“One of my top priorities has been to resolve responsibly the concerns of the PPM Coalition regarding PPM methodology. Today, the Coalition and we announced an agreement for enhancements to our recruitment methodology that are designed to be a net benefit for all our PPM customers. My thanks go to Chairman Edolphus Towns and to the Media Rating Council for their roles in advancing this agreement.

“Our priorities for the balance of 2010 are straightforward. We will work toward the completion of the commercialization of the PPM ratings service. We will continue our programs that are designed to improve key sample quality metrics for our PPM and diary services. We will continue our efforts to obtain and maintain Media Rating Council® accreditation for our services across all of our markets and we will continue our efforts to further develop our cross-platform measurement capabilities.

“While we are encouraged by recent improvement in the overall economic environment and in the radio industry in particular, we also know that it will not turn around overnight. However, we are committed to working with our customers to help position the radio industry to benefit from the recovery as it may occur.”

2010 Guidance
Arbitron is reiterating its revenue and EPS guidance for 2010.

For the full year 2010, Arbitron expects revenue to increase between two percent and six percent compared to the 2009 revenue of $385.0 million.

Earnings per share (diluted) for the full year 2010 are expected to be between $1.50 and $1.75.

Earnings Conference Call: Schedule and Access
Arbitron will host a conference call at 10:00 a.m. Eastern Time. The Company invites you to listen to the call by dialing (toll free) 888-562-3356. The conference call can be accessed from outside of the United States by dialing 973-582-2700. To participate, users will need to use the following code: 66162370. The call will also be available live on the Internet at the following sites: www.arbitron.com and www.streetevents.com.

A replay of the call will be available from 1:00 p.m. on April 22, 2010 through 11:59 p.m. on April 29, 2010. To access the replay, please call (toll free) 800-642-1687 in the United States, or 706-645-9291 if you’re calling from outside of the United States. To access the replay, users will need to enter the following code: 66162370.

Presentation of Non-GAAP Information
The terms EBIT (earnings before interest and income taxes) and EBITDA (earnings before interest, income taxes, depreciation and amortization) are non-GAAP financial measures that the management of Arbitron believes are useful to investors in evaluating the Company’s results. These non-GAAP financial measures should be considered in addition to, and not as a replacement for, or superior to either net income as an indicator of Arbitron’s operating performance, or cash flow, as a measure of Arbitron’s liquidity. In addition, because EBIT and EBITDA may not be calculated identically by all companies, the presentation here may not be comparable to other similarly titled measures of other companies. For a reconciliation of these non-GAAP financial measures to the most comparable GAAP equivalent, see the EBIT and EBITDA Non-GAAP Reconciliation, along with related footnotes, below.

About Arbitron
Arbitron Inc. (NYSE: ARB) is a media and marketing research firm serving the media – radio, television, cable and out-of-home – as well as advertisers and advertising agencies. Arbitron’s core businesses are measuring network and local market radio audiences across the United States; surveying the retail, media and product patterns of local market consumers; and providing application software used for analyzing media audience and marketing information data. The company has developed the Portable People Meter, a new technology for media and marketing research.

Arbitron’s headquarters and its world-renowned research and technology organizations are located in Columbia, Maryland.

Media Rating Council® and the “double checkmark” logo design are registered marks of the Media Rating Council.

PPM ratings are based on audience estimates and are the opinion of Arbitron and should not be relied on for precise accuracy or precise representativeness of a demographic or radio market.

Arbitron Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The statements regarding Arbitron Inc. and its subsidiaries in this document that are not historical in nature, particularly those that utilize terminology such as “may,” “will,” “should,” “likely,” ”expects,” “anticipates,” “estimates,” “believes,” or “plans,” or comparable terminology, are forward-looking statements based on current expectations about future events, which we have derived from information currently available to us. These forward-looking statements involve known and unknown risks and uncertainties that may cause our results to be materially different from results implied in such forward-looking statements. These risks and uncertainties include, in no particular order, whether we will be able to:

•

successfully maintain and promote industry usage of our services, a critical mass of broadcaster encoding, and the proper understanding of our audience measurement services and methodology in light of governmental actions, including investigation, regulation, legislation or litigation, customer or industry group activism, or adverse community or public relations efforts;

•

complete the Media Rating Council, Inc. (“MRC”) audits of our local market Arbitron Portable People Meter (“PPM”) ratings services in a timely manner and successfully obtain and/or maintain MRC accreditation for our audience measurement services;

•

design, recruit and maintain PPM panels that appropriately balance research quality, panel size and operational cost;

•

absorb costs related to legal proceedings and governmental entity interactions and avoid any related fines, limitations or conditions on our business activities, including, without limitation, by meeting or exceeding our commitments and agreements with various governmental entities;

•

successfully develop, implement and fund initiatives designed to increase sample quality;

•

successfully manage the impact on costs of data collection due to lower respondent cooperation in surveys, consumer trends including a trend toward increasing incidence of cell phone households, privacy concerns, technology changes, and/or government regulations;

•

provide appropriate levels of operational capacity and funding to support the more labor intensive identification and recruitment of cell phone households into our panels and samples;

•

successfully manage the impact on our business of the current economic downturn generally, and in the advertising market, in particular, including, without limitation, the insolvency of any of our customers or the impact of such downturn on our customers’ ability to fulfill their payment obligations to us;

•

compete with companies that may have financial, marketing, sales, technical or other advantages over us;

•

effectively respond to rapidly changing technological needs of our customer base, including creating proprietary technology and systems to support our cell phone sampling plans, and new customer services that meet these needs in a timely manner;

•

successfully execute our business strategies, including evaluating and, where appropriate, entering into potential acquisition, joint-venture or other material third-party agreements;

•

effectively manage the impact, if any, of any further ownership shifts in the radio and advertising agency industries;

•

successfully develop and implement technology solutions to encode and/or measure new forms of media content and delivery, and advertising in an increasingly competitive environment;

There are a number of additional important factors that could cause actual events or our actual results to differ materially from those indicated by such forward-looking statements, including, without limitation, the risk factors set forth in the caption “ITEM 1A. — RISK FACTORS” in our Annual Report on Form 10-K for the year ended December 31, 2009, and elsewhere, and any subsequent periodic or current reports filed by us with the Securities and Exchange Commission.

In addition, any forward-looking statements contained in this document represent our estimates only as of the date hereof, and should not be relied upon as representing our estimates as of any subsequent date. While we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so, even if our estimates change.

Arbitron Inc.
Consolidated Statements of Income
Three Months Ended March 31, 2010 and 2009
(In thousands, except per share data)
(Unaudited)


	Three Months Ended
	March 31,						%
	2010			2009			Change			Change
Revenue	$	95,896		$	98,489		$	(2,593	)		(2.6	%)
Costs and expenses
Cost of revenue		43,153			39,529			3,624			9.2	%
Selling, general and administrative		17,641			18,424			(783	)		(4.2	%)
Research and development		9,909			9,306			603			6.5	%
Restructuring and reorganization		—			8,171			(8,171	)		(100.0	%)
Total costs and expenses		70,703			75,430			(4,727	)		(6.3	%)
Operating income		25,193			23,059			2,134			9.3	%
Equity in net loss of affiliate		(2,531	)		(3,000	)		469			(15.6	%)
Earnings before interest and income taxes (1)		22,662			20,059			2,603			13.0	%
Interest income		2			19			(17	)		(89.5	%)
Interest expense		265			333			(68	)		(20.4	%)
Earnings before income taxes		22,399			19,745			2,654			13.4	%
Income tax expense		8,651			7,404			1,247			16.8	%
Net Income		13,748			12,341			1,407			11.4	%
Basic weighted average common share
Net income	$	0.52		$	0.47		$	0.05			10.6	%
Diluted weighted average common share
Net income	$	0.51		$	0.46		$	0.05			10.9	%
Weighted average shares used in calculations
Basic		26,593			26,431			162			0.6	%
Diluted		26,924			26,545			379			1.4	%
Dividends per common share	$	0.10		$	0.10			—			—
Other data:
EBITDA (1)	$	29,178		$	25,282		$	3,896			15.4	%
Non-cash share-based compensation	$	1,065		$	1,883		$	(818	)		(43.4	%)

(1) The terms EBIT (earnings before interest and income taxes) and EBITDA (earnings before interest, income taxes, depreciation and amortization) are non-GAAP financial measures that the management of Arbitron believes are useful to investors in evaluating the Company’s results. For a reconciliation of these non-GAAP financial measures to the most comparable GAAP equivalent, see the EBIT and EBITDA Non-GAAP Reconciliation, along with related footnotes, below.

Arbitron Inc.
EBIT and EBITDA Non-GAAP Reconciliation
Three Months Ended March 31, 2010 and 2009
(In thousands)
(Unaudited)

(2) Arbitron’s management believes that presenting EBIT (earnings before interest and income taxes) and EBITDA (earnings before interest, income taxes, depreciation and amortization), both non-GAAP financial measures, as supplemental information helps investors, analysts, and others, if they so choose, in understanding and evaluating Arbitron’s operating performance in some of the same manners that management does because EBIT and EBITDA exclude certain items that are not directly related to Arbitron’s core operating performance. Arbitron’s management references these non-GAAP financial measures in assessing current performance and making decisions about internal budgets, resource allocation and financial goals.

EBIT is calculated by adding back net interest expense and income tax expense to net income. EBITDA is calculated by adding back net interest expense, income tax expense, and depreciation and amortization to net income. EBIT and EBITDA should not be considered substitutes either for net income as indicators of Arbitron’s operating performance, or for cash flow as measures of Arbitron’s liquidity. In addition, because EBIT and EBITDA may not be calculated identically by all companies, the presentation here may not be comparable to other similarly titled measures of other companies.

Arbitron Inc.
Condensed Consolidated Balance Sheets
March 31, 2010 and December 31, 2009
(In thousands)


	March 31,		December 31,
	2010		2009
	(Unaudited)		(Audited)
Assets:
Cash and cash equivalents	$	11,987	$	8,217
Trade receivables		56,915		52,607
Property and equipment, net		66,816		67,903
Goodwill, net		38,500		38,500
Other assets		35,300		36,602
Total assets	$	209,518	$	203,829
Liabilities and Stockholders’ Equity:
Deferred revenue	$	40,555	$	43,148
Other liabilities		57,708		62,106
Long term debt		68,000		68,000
Stockholders’ equity		43,255		30,575
Total liabilities and stockholders’ equity	$	209,518	$	203,829

Note: The December 31, 2009 Condensed Consolidated Balance Sheet is derived from the audited Balance Sheet included in the Company’s Form 10-K for the fiscal year ended December 31, 2009.

Arbitron and PPM Coalition Settle Outstanding Disputes – Both Groups Commend Leadership of House
Oversight Committee Chairman Towns

COLUMBIA MD, April 22, 2010 – Arbitron Inc. (NYSE: ARB) and the PPM Coalition (PPMC) today announced that they have settled their outstanding disputes and plan to move forward collaboratively.

Under the leadership of House Oversight and Government Reform Committee Chairman Rep. Edolphus Towns (D-NY), Arbitron and the PPMC have worked jointly with the Media Rating Council® (MRC) to implement a series of steps designed to enhance the recruitment methodology of the Arbitron Portable People Meter™ (PPM™) ratings service. These enhancements include the addition of address-based sampling with targeted in-person recruiting to increase PPM panelist participation in key market segments.

“Arbitron remains committed to the continuous improvement of our PPM ratings service,” said William T. Kerr, Arbitron Chief Executive Officer and President. “We have worked with the PPMC and the MRC to design these initiatives, and we believe they will help Arbitron deliver the quality data that our customers expect. These initiatives, together with other elements, are part of a larger ongoing program by Arbitron to obtain and retain MRC accreditation. We appreciate the leadership of Chairman Towns and his team for helping move this dialogue forward.”

“We believe that this agreement represents a positive step that moves both groups forward in a spirit of collaboration,” said Charles Warfield, Chief Operating Officer, ICBC Broadcast Holdings, Inc., on behalf of the PPMC. “This has been a long and difficult journey, but we are committed to working closely with Arbitron and the MRC and seeing the implementation of these initiatives.”

“Reliable ratings data is vitally important for all stakeholders in the radio marketplace,” added Joe Uva, President and Chief Executive Officer of Univision Communications Inc. “Arbitron’s commitment to evolve its methodology is a step forward in achieving that goal.”

“We are very pleased with the settlement. We hope it marks the beginning of a new kind of partnership with Arbitron where we all work together to continuously improve the PPM service which we believe will instill a new level of confidence in its results,” said Frank Flores, Chief Revenue Officer of Spanish Broadcasting System, Inc.

The initiatives include the addition of targeted in-person recruitment to Arbitron’s multi-faceted PPM panelist recruitment approach that currently includes mailings and phone calls. In-person recruitment benefits all broadcasters as it targets population segments that are more likely to be reachable only by cell phone – including youth and minorities. Arbitron will also use address-based sampling to select landline households to further improve geographic proportionality.

This enhanced recruitment approach is scheduled to begin in July 2010 with targeted in-person recruiting. In-person recruiting would initially be deployed in the high density Black and Hispanic areas across the top 25 PPM Markets by year-end 2010; with implementation of address-based sampling and the addition of targeted in-person recruiting across all geographies of all PPM Markets by the end of 2011.

Additional initiatives undertaken by Arbitron to help support minority and all broadcasters include:

•

Increasing the PPM sample size for people 18-54 by approximately 10 percent by mid-2011 as previously disclosed;

•

Forming a minority leadership council in 2010 to bring the leadership of broadcasters and agency communities together; and

•

Expanding current initiatives directed toward advertiser outreach for minority radio.

“We hope that this agreement has placed us on the road to the improved audience measurement,” said Jim Winston, Executive Director of the National Association of Black Owned Broadcasters. “We have been talking with Arbitron for more than three years about PPM, and I am pleased that we have been able to come to an agreement for moving forward.”

“In order to effectively reach and connect with minority populations, quality data and audience representation is imperative for agencies and advertisers,” said Jessica Pantanini, Association of Hispanic Advertising Agencies (AHAA) chair-elect and COO of Bromley Communications. “We appreciate the commitment to address the needs of minority communities and embrace the implementation of these initiatives.”

“The MRC has been focused on seeking more in-person recruitment, meter-installation and respondent coaching, as well as improved sample distribution, in Arbitron’s PPM methodology as part of our accreditation proceedings,” said George Ivie, CEO and Executive Director of the Media Rating Council. “We are pleased to see Arbitron agree to add these enhancements, which we believe can improve the quality of Arbitron’s currency ratings, and the MRC is proud to have been an independent and neutral component of this ongoing dialogue as requested by the House Oversight Committee.”

Arbitron has maintained its commitment to continuous improvement and obtaining and maintaining MRC accreditation for our PPM ratings service. While these and other improvement initiatives have been designed to accomplish the goals described above, there can be no assurance of success.

The PPM Coalition was formed in 2008 specifically to address its members’ concerns with Arbitron’s PPM methodology. PPMC members include ICBC Broadcast Holdings, Inc., Univision Communications, Inc., The Association of Hispanic Advertising Agencies, Spanish Broadcasting System, Inc., The National Association of Black Owned Broadcasters and The Minority Media and Telecommunications Council.

Arbitron Inc. (NYSE: ARB) is a media and marketing information services firm primarily serving radio, television, cable, advertising agencies, advertisers, retailers, out-of-home media, and online media. Arbitron’s core businesses are measuring and estimating network and local market radio audiences across the United States; providing application software used for analyzing our media audience and marketing information data; and providing consumer, shopping, and other media usage information services. The Company has developed the Portable People Meter^TM, a new technology for media and marketing research.

Media Rating Council® and the “double checkmark” logo design are registered marks of the Media Rating Council.

PPM ratings are based on audience estimates and are the opinion of Arbitron and should not be relied on for precise accuracy or precise representativeness of a demographic or radio market.

Statements in this release that are not strictly historical, including the statements regarding expectations for 2010 and any other statements regarding events or developments that we believe or anticipate will or may occur in the future, may be “forward-looking” statements. There are a number of important factors that could cause actual events to differ materially from those suggested or indicated by such forward-looking statements. These factors include, among other things, the current global economic recession and the upheaval in the credit markets and financial services industry, competition, our ability to develop and successfully market new products and technologies, our ability to successfully commercialize our Portable People Meter(TM) service, the growth rates and cyclicality of markets we serve, our ability to expand our business in new markets, our ability to successfully identify, consummate and integrate appropriate acquisitions, the impact of increased costs of data collection including a trend toward increasing incidence of cell phone households, litigation and other contingent liabilities including intellectual property matters, our compliance with applicable laws and regulations and changes in applicable laws and regulations, our ability to achieve projected efficiencies, cost reductions, sales growth and earnings, and international economic, political, legal and business factors. Additional information regarding the factors that may cause actual results to differ materially from these forward-looking statements is available in our SEC filings, including our 2009 Annual Report on Form 10-K. These forward-looking statements speak only as of the date of this release and the Company does not assume any obligation to update any forward-looking statement.


Delaware	1-1969	52-0278528
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)

9705 Patuxent Woods Drive, Columbia, Maryland		21046
_________________________________ (Address of principal executive offices)		___________ (Zip Code)


	Arbitron Inc.

April 22, 2010	By:	Timothy T. Smith

		Name: Timothy T. Smith
		Title: Executive Vice President and Chief Legal Officer, Legal and Business Affairs and Secretary


Exhibit No.		Description

99.1		Press Release of Arbitron Inc. dated April 22, 2010
99.2		Press Release of Arbitron Inc. dated April 22, 2010


Date of Report (Date of Earliest Event Reported):		April 22, 2010


Registrant’s telephone number, including area code:		410-312-8000


Press Information		Arbitron Inc Deirdre Blackwood 410-312-8523 Didi.blackwood@arbitron.com		PPMC David H. Pawlik Skadden, Arps, Slate, Meagher & Flom, LLP 202-371-7044 david.pawlik@skadden.com